A stall of the Kinh Do Confectionary Co in the capital. Confectionery is expected to expand a further 8-10 per cent annually from 2011 to 2014 and begin exporting by 2020. — VNS Photo Truong Vi

HA NOI (Biz Hub)— Confectionery production will see the highest growth in the food technology industry, Vu Quang Hung, deputy head of the Ministry of Industry and Trade's Institute for Industry and Strategy Policies, has said.

Speaking at a conference discussing the development of the food technology sector by 2020 held in Ha Noi last week, Hung said the industry had a relatively high growth rate of 17 per cent in the 2006-10 period.

The food technology industry had become one of the most attractive sectors with a strong growth rate and high consumption, he said.

The sector's production value also showed high growth from VND6 trillion (US$285.7 million) in 2005 to VND17 trillion ($809.5 million) in 2011.

Of the total, confectionery production grew at 35 per cent, glutamate 10 per cent and instant noodles 10 per cent.

Confectionery was expected to expand a further 8 to 10 per cent annually from 2011 to 2014 and begin exporting by 2020.

He added that the food technology industry was targeting an initial 14 per cent export growth rate in 2020, rising to revenues of around $1 billion by 2030.

In addition, he said, the food technology industry showed remarkable changes. In 2011, instant noodles accounted for 30 per cent of the total while it took the lead in the sector in 2005, accounting for 40 per cent.

Confectionery production achieved impressive growth from 20 per cent in 2005 to 40 per cent in 2011.

The number of confectionery businesses also rapidly increased from 182 in 2005 to 324 in 2011.

The production was divided into three groups: imports accounting for 20 per cent, businesses holding high proportion such as Kinh Do Group, Hai Ha Confectionery Company and Bibica Joint Stock Company accounting for 42 per cent, and other enterprises.

However, he said confectionery consumption in Viet Nam was 1.9 kilos per person a year, which was much lower than the world's yearly average level of 2.4 kilos per person.

According to the industry's development plan, it targetted to achieve high and sustainable growth, improving product quality and diversification.

However, he said, the sector's competitive ability was mainly in domestic market while its exports were limited. For example, the glutamate export totalled only $100 million last year, which was much lower than its potential.

He said the sector should have a clear strategy for maximising local businesses' global competitiveness, upgrading assembly technology and promoting the reputation of its brands.

Deputy Minister Ho Thi Kim Thoa said the sector's technology and human resource quality was lower than other countries. The Government should be giving incentive policies, trademark registrations, trade promotions and accurate market data collection and analysis.

Thoa said global economic fluctuations made ensuring food quality, safety, and hygiene standards were reliably met all the more important. — VNS